Advantages and Disadvantages of Homeowners Associations

When people hear the phrase “homeowners association” (HOA), many tend to cringe. Living within the boundaries of an HOA often means more work and lots of critiques from the neighbors.

Belonging to an HOA isn’t nearly as bad as the media often portrays it, however, and there are generally as many benefits as disadvantages.

A Brief Look at Homeowners Associations

In essence, a homeowners association is a tiny government that manages and keeps the peace in your neighborhood. The entire purpose of an HOA is to maintain a higher quality of life for its tenants and homeowners.

Membership is mandatory if you purchase a home within the HOA limits, and they collect regular fees. In return for your payments, an HOA offers service and certain amenities, such as a clubhouse, private park, or community pool. Some also handle the basic maintenance and pest control.

Generally, an HOA will also require that homeowners within its purview observe certain rules. They’ll mandate such details as the color of your home, the length of your grass, the landscaping in your front yard, exterior décor during holidays, car parking, and even regular roof maintenance.

Overall, such rules are supposed to exist for the betterment of the neighborhood, since they help to keep the area looking clean and well preserved. For some, this way of life sounds like a dream come true. For others, the hassle and risks are simply too much.

If you’re not sure how an HOA would affect your way of life, consider this list of pros and cons.

Advantages of a Homeowner’s Association

Most HOA rules are well intended and carried out without any problems. In many cases, the rules will actually be more of a benefit than a hassle. Here are some of the best aspects of HOAs.

• Nicer Neighborhoods: Because the rules are strict about your home’s exterior appearance, the result is a nicer neighborhood. The homes will look more upscale; there won’t be any eyesores on your block. Many HOAs facilitate a neighborhood watch, as well, put up a gate around the community, and hire security to monitor the area, which makes it safer overall.

• Mediator for Neighbor Disputes: Any time you have an argument about a dog barking all night long, your exact property line, or loud parties, the HOA will address it. Because of the penalties for breaking rules, you probably won’t have many problems anyway.

• Higher Quality of Living: Every rule enforced in an HOA is made for the purpose of raising the quality of living. Your neighborhood will be more peaceful, safe, and beautiful because of the rules, which increases your quality of life.

• Free Community Amenities: Many HOAs will use the fees collected each month to build and maintain community areas such as parks, pools, and even recreational facilities. Since the cost is included in your monthly payment, using these services will come at no extra cost to you, and they’ll be maintained to perfection.

• Basic Maintenance Included: Often, basic maintenance such as plumbing, landscaping, and snow removal will be performed. This reduces your responsibilities and gives you peace of mind if a pipe bursts.

• Say Goodbye to Pests: Most associations will go to great lengths to eliminate pests in the area: They’ll provide pest control. There will be no scruffy dogs running around, raccoons climbing into your garbage, or termites eating up your walls.

Disadvantages of a Homeowners Association

For some, the disadvantages of HOAs far outweigh the advantages. If they see a property belongs to one, they won’t look twice. Here are some of their biggest complaints.

• Fees: Like every other element of HOAs, the fees differ based on the amenities and services the association will provide, but they’re usually pretty extreme. Some will be as high as $600 a month, which is considerably more than many homeowners will be able to afford.

• Constant Maintenance: The rules and regulations that come with HOAs are nothing short of strict; they require you to attend to the maintenance of your home almost constantly. If you don’t have a lot of time to spend on your home’s appearance, and lack the funds to hire someone to take care of it for you, the maintenance alone will be enough to discourage a property with an HOA.

• Increased Neighbor Disputes: Although the association will handle disputes for you, sometimes it will create them. A neighbor might argue that you aren’t following the regulations, or maybe he’ll be mad at you because you called the HOA on him for something else.

• Can Discourage Renters: There are often restrictions on renting as well. For example, your association may say that only 15 percent of the homes in the community can be rented while the others must be occupied by the owners. Others will require that tenants go through a rigorous screening process and win board approval before you can rent to them. This can make it difficult to turn a profit on an investment property.

• Foreclosure Is Possible: Some HOAs actually have the power to foreclose on your home if you can’t pay the fees. Regulations vary from state to state, and though they’ll generally foreclose only in rare cases, it’s still something to think about.

• Extra Fees: There may also be situations when the HOA proposes to do something for the benefit of the community, but doesn’t have the funds to do so. In that case, the HOA can actually impose an assessment on each homeowner in the division. Currently, 70 percent of HOAs are underfunded, which means the odds of escaping extra fees aren’t in your favor.

Some of these drawbacks may not apply to you, or they may not seem too bad. If that’s the case, an HOA could be a great option.

However, if the fees, maintenance, and unknown risks seem too much, you might search for a property elsewhere.

Use Green Residential as An Alternative

If the maintenance, pest control, property management, and overall appearance of the property are attractive, but the fees and maintenance are making you leery of an HOA, it may be in your interest to hire Green Residential as your property management company instead.

We specialize in keeping every aspect of your rental property in tip-top shape, as if it were belonged to an HOA, without any of the work or risks. For more information on the high-quality services we offer, contact us today!

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